What will happen to Meta's virtual reality platform?

In October 2021, Mark Zuckerberg, CEO of Facebook, rebranded the company as Meta and shifted its focus to the metaverse.

"At the time, there was a genuine need and desire for Facebook, the company, to rebrand into something else, as stated by Leo Gebbie, principal analyst and director at CCS Insight. The company wanted to make it clear that it was more than just a social website."

Since 2014, when Facebook bought virtual reality headset developer Oculus and launched Reality Labs, Zuckerberg's metaverse ambitions have been a part of Meta. With the global pandemic leading to an increase in online population, Meta and Wall Street saw an opportunity to capitalize on the virtual reality headset wave and boost the revenue of the global video game industry, which reached $193 billion in 2020.

"According to Gebbie, there was a feeling in 2020 and 2021 that virtual reality was finally going to become mainstream. However, we have had many false starts in the past."

In December 2021, Horizon Worlds was launched in the U.S. by Meta, marking its entry into the open world virtual reality platform space. Meta aimed to achieve a short-term goal of 500,000 monthly active users in Horizon Worlds by the end of the year. However, its long-term goals were more ambitious, with Zuckerberg stating in June 2022 that he expected one billion users by the end of the decade, with each user expected to do "hundreds of dollars of e-commerce each."

The company has a very long way to go.

Despite its initial success, Horizon Worlds has seen a decline in monthly active users, with only 200,000 users remaining a year after launch. The term "metaverse" has largely disappeared from public conversation, with a sharp fall in searches for the term after 2022. Reality Labs, the parent company of Meta, has been losing money, with $58 billion in operating losses since 2020. However, the company has found some success in augmented reality through its partnership with Ray-Ban. Meta did not respond to CNBC's request for comment.

What is the current status of the metaverse? What exactly is the metaverse? Watch the video to find out.— CNBC's Jonathan Vanian contributed to this report.